DEFINITION of 'Weighted Alpha'
A weighted measure of how much a stock has risen or fallen over a certain period, usually a year. Generally, more emphasis is placed on recent activity by assigning higher weights to it than those assigned to earlier movements. This helps to give a return figure that has a greater focus on the most current period and is a more relevant measure for shortterm analysis. This technique is popular with technical analysts.
BREAKING DOWN 'Weighted Alpha'
If the stock was up over the period, it will have a positively weighted alpha. An unchanged stock price has a small weighted alpha. A stock whose price has fallen over the period will have a negatively weighted alpha. Technical analysts use this measure to identify companies that have shown a strong trend over the past year and, more specifically, to focus their attention on companies whose momentum is building.

Weighted
A mathematical process by which figures and/or components are ... 
Weighted Average
An average in which each quantity to be averaged is assigned ... 
Equal Weight
A type of weighting that gives the same weight, or importance, ... 
Alpha
Alpha is used in finance to represent two things: 1. a measure ... 
Weighted Average Market Capitalization
A stock market index weighted by the market capitalization of ... 
Portfolio Weight
The percentage composition of a particular holding in a portfolio. ...

ETFs & Mutual Funds
Alpha and Beta for Beginners
An indepth look at what alpha and beta are and what they measure. 
Investing
Weighted Average Cost Of Capital (WACC)
Weighted average cost of capital may be hard to calculate, but it's a solid way to measure investment quality 
ETFs & Mutual Funds
Smart Beta vs. Active Management: Which is Better? (BLK, SCHB)
Learn how smart beta funds combine the advantages of both active and passive management by tracking customized indexes without capitalization weighting. 
Trading
Weighted Moving Averages: The Basics
We take a closer look at the linearly weighted moving average and the exponentially smoothed moving average. 
Managing Wealth
Evaluating Alpha and Beta
Alpha and beta are risk ratios that investors use to calculate, compare and predict returns. 
Trading
Bettering Your Portfolio With Alpha And Beta
Increase your returns by creating the right balance of both these risk measures. 
Investing
The No. 1 Stock For This Stagnant Market
Earlier this week, I told you that the market is poised to take a bearish turn and cited three main reasons: 1. Weak fundamentals 2. Lofty market valuation 3. Investor complacency But I also ... 
Investing
Exploring The Exponentially Weighted Moving Average
Learn how to calculate a metric that improves on simple variance. 
Trading
The Consumer Price Index
Find out how this economic measure can help you make key financial decisions. 
ETFs & Mutual Funds
Strategies For Determining The Market's True Worth
Learn the strengths and weaknesses of passive and active management when trying to uncover the overall market's worth.

What are the best technical indicators to complement Weighted Alpha?
Find out how technical analysts and traders use a stock's weighted alpha to confirm momentum or select specific stocks to ... Read Answer >> 
What is a common strategy traders implement when using the Weighted Alpha?
Learn how traders and investors use weighted alpha to identify momentum of a stock's price and whether prices will move higher ... Read Answer >> 
What is the Weighted Alpha formula and how is it calculated?
Find out how investors and analysts calculate the weighted alpha of a stock's price by emphasizing recent price movements ... Read Answer >> 
Why is the Weighted Alpha important for traders and analysts?
Learn about the weighted alpha indicator, and see how traders and analysts use it to spot securities with momentum is building ... Read Answer >> 
How do I use Weighted Alpha to create a forex trading strategy?
Find out how the concept of weighted alpha can be applied to currency contracts in the foreign exchange market to spot potentially ... Read Answer >> 
Stocks with a positive alpha are considered to be underpriced ...
The correct answer is a): The riskadjusted return attempts to measure the risks taken to achieve a desired return. Alpha ... Read Answer >>